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Facts
The assessee, engaged in transportation services, filed a return under the presumptive taxation scheme. Following a survey at a customer's premises, the assessee's case was reopened, and an addition of Rs. 61,12,900/- was made under Section 68 for unexplained credit entries. The CIT(A) dismissed the assessee's appeal ex-parte due to non-compliance.
Held
The tribunal held that the CIT(A) did not decide the appeal as per Section 250(6) and that principles of natural justice require providing sufficient opportunity of being heard. Therefore, the tribunal set aside the CIT(A)'s order and remitted the matter back for fresh adjudication after giving the assessee due opportunity.
Key Issues
The key legal issues were the validity of the ex-parte dismissal by the CIT(A) without adequate opportunity of being heard and the confirmation of the addition under Section 68 without proper consideration of the assessee's submissions.
Sections Cited
Section 68, Section 133A, Section 139(1), Section 147, Section 148, Section 148A(b), Section 144B, Section 250(6)
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Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT
Before: DR. ARJUN LAL SAINI & DR. DINESH MOHAN SINHA
आदेश/ O R D E R Per, Dr. Dinesh Mohan Sinha, JM:
Captioned appeal filed by the assessee, pertaining to Assessment Year (AY) – 2016-17, is directed against the order passed by the National Faceless Appeal Centre [(in short “NFAC/Ld. CIT(A)”] vide order dated 23.09.2025, which in turn assessment order dated 18.05.2023 passed by Income Tax Department/Assessing Officer u/s. 147 r.w.s. 144B of the Income Tax Act, 1961 (in short “the Act”).
Grounds of appeal
raised by the assessee are as follows: 1.The grounds of appeal mentioned hereunder are without prejudice to one another.
2. Ld. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, Delhi[hereinafter referred to as the "CIT(A)"] erred on facts as also in law in dismissing the appeal ex-parte without allowing adequate opportunity of being heard.
Rameshbhai K. Myatra 3. The Id. CIT(A) erred on facts as also in law not deciding ground of appeal related to validity of notice issued u/s 148 of the Income tax Act, 1961. That on facts as also in law, proceedings-initiated u/s. 147 of the Act is invalid and assessment finalized on such invalid initiation deserves to be quashed and may kindly be quashed.
4. The Id. CIT(A)erred on facts as also in law in confirming addition of Rs.61,12,900/- made u/s.68 of the Act on the alleged ground that the appellant failed to explained source of credit entries in books alongwith documentary evidences. The addition confirmed is unjustified and uncalled for, which may kindly be deleted.
5. Your Honour's appellant craves leave to add, to amend, alter, or withdraw any or more grounds of appeal on or before the hearing of appeal.”
Brief facts of the case are that the appellant, an individual is engaged in the business of providing transportation services and derived income from the same and filed return of income by opting presumptive taxation scheme. Return of income for the assessment year 2016-17 was filed u/s. 139(1) of the Income-tax Act, 1961, on 16.01.2017 declaring therein total income at Rs.6,61,190/-. Survey action u/s. 133A of the Act was carried out at the business premises of appellant's customer namely M/s. Shiv Shipping and Logistics on 07.12.2020. On the basis of certain document / data impounded during the survey and statements recorded, appellant's case was re-opened by issuing notice u/s. 148 the Act dated 28.04.2021 was deemed as show-cause notice issued u/s. 148A(b) of the Act under amended provisions of the Act.
The AO issued show-cause notice dated 10/05/2023. In response to the, show- cause notice, the appellant made detailed submission and objected the proposal of the AO. The AO however without considering the appellant's submission and without providing an opportunity of cross-examination finalized the assessment proceeding by passing an order u/s. 147 r.w.s. 144B of the Act dated 18/05/2023 by assessing the total income of Rs. 67,74,090/- by making addition of Rs. 61,12,900/- u/s. 68 of the Act.
Page 2 of 4 Rameshbhai K. Myatra 5. That the assessee filed an appeal against the order of the AO vide order dated 18.05.2023 in the office of the Ld. CIT(A), which was dismissed by following observation:
“In view of the above the primary onus of complying with the notices is that of the appellant above after taking into consideration of all the material on record. In view of the above, the appeal is hereby treated as infructuous treated as dismissed as well as non-compliance accordingly. 6.To sum up appeal is dismissed accordingly.”
That the assessee filed an appeal against the impugned order dated 23.09.2025 before this Tribunal.
a. During the course of hearing, the Ld. AR of the assessee prayed for one more opportunity to be given to the assessee to represent the case before the lower authority. b. On the contrary, the Ld. Sr. DR for the revenue relied on the order of the Ld. CIT(A) and not objected to the prayer of the Ld. AR of the assessee.
We have heard both the parties and perused the material available on record. The Ld. CIT(A) has issued notices for hearing of the case but there was no response to the notice by the appellant. We note that Ld. CIT(A) has not decided the appeal as per mandate of provisions u/s. 250(6) of the Act. However, we are of the view, that one more opportunity should be given to the assessee to plead his case before the Ld. CIT(A). It is settled law that principles of natural justice and fair play require that the affected party should be granted sufficient opportunity of being heard to contest his case. Keeping in view, in the interest of justice, we set aside the order of the Ld. CIT(A) and remitted the matter back to Page 3 of 4
In the result, the appeal of the assessee is allowed for statistical purposes.
Order is pronounced in the open court on 09/03/2026.